Income tax in Serbia

Taxation Researcher | October 03, 2019

INDIVIDUAL TAXATION

Residents are taxed on their worldwide income. Married couples are taxed separately.

INCOME TAX

Serbia modern house

Income is classified into different categories: (1) income from employment, (2) income from agriculture and forestry, (3) business and professional income, (4) income from royalties, (5) investment income (dividends, interest), (6) income from immovable property, (7) capital gains, and (8) other income.

Net income is computed separately for each category. Different tax rates apply, depending on the type of income or source of income.

INCOME TAX

TYPE OF INCOME
TAX RATE
Employment Income
10%
Business Income
10%
Dividends and Interest Income
15%
Income from Royalty
20%
Income from Capital
15%
Rental Income
20%
Other Income
20%
Source: Global Property Guide

The annual income tax due by Serbian residents on net worldwide income in excess of a prescribed threshold is levied at progressive rates, ranging from 10% to 15%. The prescribed threshold is three average annual salaries.

COMPLEMENTARY INCOME TAX

TAX BASE
TAX RATE
Up to 3 average annual salaries 0%
3 average annual salaries - 6 average annual salaries 10%
Over 6 average annual salaries 15%
Source: Global Property Guide

RENTAL INCOME
Rental income earned by residents is subject to provisional withholding tax at a flat rate of 20%. A 25% fixed lump-sum deduction from the gross income is available for income-generating expenses.

If the rent is paid in advance for a period of more than a year, the income may be spread over in equal parts to a maximum period of five years.

CAPITAL GAINS
Capital gains realized by residents from the sale of Serbian property are taxed at a flat rate of 15%. The taxable gain is the selling price less the acquisition price (as revalued by the consumer price index) and depreciation costs.

Any capital gain realized through a sale of property obtained before 24 January 1994 is exempt from capital gains tax.

Transfers of property between relatives are exempted from capital gains tax. In addition, if the capital gain is invested in housing within a 60-day period, the gain is also exempt from tax.


PROPERTY TAX

Real Estate Tax

Property tax is levied on the property value at a maximum rate of 0.40%. Property tax in Serbia is paid by the individual owner of the property or property rights.

INCOME TAX 2015

TAX BASE, RSD (€) TAX RATE
Up to 10 million (€83,333) 0.40%
10 million - 25 million (€208,333) 0.60% on band over €83,333
25 million - 50 million (€416,667) 1% on band over €208,333
Over 50 million (€416,667) 2% on all value over €416,667
Source: Global Property Guide

INCOME TAX 2014

TAX BASE, RSD (€) TAX RATE
Up to 6 million (€50,000) 0.40%
6 million - 15 million (€125,000) 0.80% on band over €50,000
15 million - 30 million (€250,000) 1.50% on band over €125,000
Over 30 million (€250,000) 3% on all value over €250,000
Source: Global Property Guide

Property tax is levied on the property value at a flat rate of 0.40% for businesses.

CORPORATE TAXATION

INCOME TAX

Income and capital gains earned by companies are liable for corporate income tax at a flat rate of 15%. Income-generating expenses are deductible when calculating taxable income.

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